Company that defaulted on lease now threatening to sue Boulder City

By Dylan Scott

Thursday, Jan. 27, 2011 | 2:05 a.m.

The president of Sol Bio — the renewable energy company that defaulted on its lease with Boulder City, leaving the city to fill a $2.4 million budget hole with reductions in services and layoffs — e-mailed city officials earlier this month to tell them that he planned to sue the city for terminating the contract.

In a brief e-mail sent to City Attorney Dave Olsen and City Manager Vicki Mayes, which she provided to the Sun, David Irwin said he “hereby gives Boulder City notice of a pending legal action to have Sol Bio’s lease re-instated and amended...or in the alternate, seek significant financial damages.”

Irwin, who sent the e-mail on Jan. 4, said formal court documents will be filed “by the end of the month.”

Boulder City sent Irwin a letter of default in October — more than six months after the first lease payment was due. The city and company signed a contract in December 2009 for Sol Bio to build a $2 billion solar power plant on 2,200 acres in the Eldorado Valley. The plant would have been the company’s first.

The city budgeted for $2.4 million in revenue from Sol Bio’s lease by the end of the 2011 fiscal year in June. When it became apparent that Irwin, who had repeatedly told city officials that he was working to secure financing for the project, would not succeed, Boulder City had to make up the difference by leaving vacant positions open, reducing services at some city facilities and ultimately forcing its public information officer into early retirement.

At Tuesday’s city council meeting, the council sent out a request for proposals for other companies to build on the Sol Bio site. Mayes said there was substantial interest in the site, and she would send out the request within 30 days.

When asked about the threatened lawsuit, Olsen said he doubted that Irwin would file it, noting that the deadline set in the e-mail was near.

Regardless, Irwin’s claim “doesn’t have a leg to stand on,” Olsen said.

Efforts to contact Irwin by phone and e-mail were unsuccessful.